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presented in support of their equitable estoppel argument not
only fails to show affirmative misconduct on the part of
respondent; it fails to preclude the possibility that
respondent’s concessions in the prior taxable years were
attributable to mistakes of law. The doctrine of equitable
estoppel does not bar respondent from correcting mistakes of law.
Auto. Club of Mich. v. Commissioner, 353 U.S. 180, 183 (1957);
Zuanich v. Commissioner, 77 T.C. 428, 432-433 (1981). We hold
that equitable estoppel does not apply to respondent’s
determinations in this case.
VII. Conclusion
We hold that $25,130 of the payments Mr. Forste received
from DHS in 1996 is excludable from petitioners’ gross income
under section 104(a)(2). We also hold that the payments Mr.
Forste received from DHS in 1996 that exceed $25,130 are not
excludable from gross income under section 104(a)(2).
Decision will be
entered under Rule 155.
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